Carrier, Shipper and Broker Responses to “Unsatisfactory” Safety Ratings

John Anderson Q & A, Regulations, Transportation

A reader questioned my advice in the last newsletter that a broker or shipper should never use a motor carrier that has, or has received notice that it will be assigned, an “unsatisfactory” safety rating. The reader felt that it was a disservice to carriers for me not to explain the safety rating procedure. In addition, he felt that if brokers and shippers took my advice to heart and never used such a motor carrier that the motor carrier should immediately go out of business voluntarily. The reader felt that motor carriers in this position should be given a second chance to prove themselves, which is the American way.

In this situation, a shipper’s and broker’s response will be different from a carrier’s response.

I stand by my advice that a shipper or broker should never use a motor carrier that it knows is assigned, or knows is going to be assigned, an “unsatisfactory” safety rating. I need to note, however, that brokers and shippers generally will not know that a motor carrier is going to be assigned an “unsatisfactory” rating. That impending assignment is not publicly available. Nevertheless, if a shipper or broker learns of the impending assignment, it should act as if the assignment already exists.

Case law holds that a broker’s and shipper’s duty is to arrange for a competent motor carrier to transport a shipment. I do not believe it is possible to establish that an “unsatisfactory” rated motor carrier is a competent motor carrier. If a broker or shipper knows that a carrier is assigned, or has been given notice that it will be assigned, an unsatisfactory safety rating, that broker or shipper has a duty not to use that carrier. If the broker or shipper breaches its duty and uses the carrier despite having that knowledge, then it is as liable as the motor carrier to the injured party if and when an accident occurs. For many brokers and shippers their very existence is at risk.

A carrier’s response to a notice that it is going to be assigned an “unsatisfactory” safety rating is to be as proactive as possible to get the rating changed. As indicated above, the notice of an impending assignment given to the motor carrier is not publicly available. This fact, together with the applicable regulations, gives a motor carrier a window of opportunity to correct the problem and avoid the “unsatisfactory” rating from becoming final.

Safety ratings are assigned as a result of a compliance review (“CR”). A safety rating is assigned within 30 days following completion of the CR. The motor carrier will receive a letter stating the rating assigned. If the rating is “satisfactory,” it is effective immediately. However, if the rating is “unsatisfactory” or “conditional,” it does not become final for 60 days (45 days for hazmat carriers). This gives the motor carrier a window of opportunity to challenge the rating and/or take corrective action, a window of opportunity it cannot afford to squander.

The regulations at 49 CFR 385.11(e) and 385.15 allow the motor carrier to request administrative review if it believes that the assignment is in error. In the case of an “unsatisfactory” assignment, the request must be made within a very short 15 days. There is no assurance that the FMCSA will act on the request for administrative review within the 60 day (45 days for hazmat carriers) window of opportunity. I therefore do not recommend this procedure because of the uncertainty of obtaining relief within the time constraints imposed.

An alternative procedure available to motor carriers is to request a change in the impending rating based on corrective action. This procedure is provided for in 49 CFR 385.11(f) and 385.17. Obviously, it is critical for the motor carrier to actually take substantive corrective action. This needs to be done immediately, and a written request outlining the corrective action taken must be made to the local FMCSA Service Center. The local FMCSA Service Center must respond within 45 days (30 days for hazmat carriers).

It is strongly recommended that any motor carrier facing this situation not only make the written request providing as much detail as possible, but that it also establish personal contact with the appropriate person at the local FMCSA Service Center. Indeed, a motor carrier should make every effort to meet face-to-face with the appropriate individuals at the local FMCSA Service Center to review the corrective action taken and to determine if anything more needs to be done. This is extremely important since the rule allows the FMCSA to extend the effective date of the assignment by an additional 60 days (10 days for hazmat carriers) if it finds that the motor carrier is making a “good faith effort to improve its safety status.” Furthermore, it is likely that the local FMCSA Service Center will want to conduct a follow up CR to confirm that the corrective action outlined and discussed actually has been implemented. My experience is that the local FMCSA officials are sensitive to the time constraints and will meet and work with motor carriers to discuss corrective action taken, further corrective action needed, and to schedule the follow-up CR.